How Africa insurance companies can start improving their businesses with AI - Curacel

How Africa insurance companies can start improving their businesses with AI

October 18, 2021

Artificial intelligence is one of the essential technologies that is transforming the insurance industry globally. According to McKinsey, through this artificial intelligence technology, the efficiency of insurers’ experience has increased with the reduction of cost in service delivery, especially in automating underwriting, better customer service, and quick processing of claims. 

Ideally, with these factors at hand, insurers’ operations and businesses have improved significantly.

In Africa, insurance companies, partnering with insurtechs such as Lami, Curacel, Lumkani and Naked Insure, are experiencing a boom.


AI is changing insurance in Africa

Most insurance companies globally employ AI applications, with Africa being one of the hot spots recently. The value of AI for insurance can be seen in its personalization and customization capabilities, driving values for policyholders. Consequently, identifying critical contributors to the positive trend is vital to understanding this growth.

Read Also: Using Technology to Tackle Insurance Fraud in the Booming African Market

The increasing use of AI in the insurance industry has reduced the level of fraudulent claims. For example, through this technology, companies can identify fraud associated with inclusive insurance and impacts. And this should happen before a claim is settled. 

Secondly, they can investigate claims to determine the variation of fraudulent activities in micro-insurance and regular insurance. If insurance companies can reduce their cost of operations and time of operations, they have enough resources that can be devoted to design new products that support ‘insuring the uninsured’. 

AI will increase the rate of insurance adoption in Africa

According to Chummun, low-income earners in African countries are excluded from accessing better insurance services.

Consequently, they have limited financial benefits associated with inclusive cover. Ideally, with this cover, the market niche is prone to grow faster.

Studies indicate that low-income households are likely to grow faster than those accessing inclusive cover in developing nations. This is an advantage for emerging (growing) markets and has been one of the reasons more fundings are invested in insurtechs. 

Essentially, the inclusion of low-income earners will improve economic welfare and the inclusion of every citizen globally.

Additionally, Chummun asserts that most West African countries have low-income populations and benefit from inclusive insurance. This approach will boost trust issues with the insurance industries subject to the ability to regulate fraud activities.

Convenience and easy accessibility to insurance products 

The level of customer satisfaction in most insurance companies in South Africa, Nigeria and Kenya has grown, with most industries adopting artificial intelligence in their daily operations. Essentially, through the use of electronic gadgets such as smartphones and application software tools in African countries, transparency, and better customer services have increased significantly, according to Kokonya

Read Also: Insurance Future: The 4 Products and Services Driving New Business Models

In Kenya, for example, Jubilee Insurance Company has initiated many online applications such as JubiCare and JubiAgent. Additionally, through integrating AI in social media platforms such as Facebook using Chabot called Julie, the company can provide efficient and effective customer services. Therefore, with these applications, clients can get necessary services, including self-service, from the comfort of their homes.

Data creation, capture, analysis, and storage have improved in the insurance industry subject to the integration of AI, thus enhancing and transforming decision-making. 

Essentially, insurance companies can easily manage risks besides collecting data and creating a vital and personalized output.

Data and Early Fraud Detection 

According to the International Data Corporation, the digital universe is expected to double after every two years. Consequently, a large pool of statistical data will be created in the insurance industry, leading to meaningful information. Decision-making, risk management, fraudulent activities, and tailored premiums will easily be managed.

Insurance industries have benefited significantly from the ability of AI to exhibit human behaviour and execute activities such as planning and solving complex problems. 

For example, today, computers can solve the problem and make an amicable decision upon analyzing a situation. Curacel, for example, provides automated systems that have helped curb fraud in claim processing. The technology automatically blocks wasteful claims (FWA – fraud, waste, and abuse) and practices from partners and clients with the help of the insurer’s underwriting and operating regulations. 

In ensuring fairness, the fraud detection feature offers extensive reasoning and signs for fraud suspicion, providing investigators with the data they require to look into mischief across all business lines. 

In addition, the fraud detection solution offers accuracy of a high level to prevent errors that may affect innocent clients and partners. This detection solution brings the critical point of efficiency. 

Technology will power distribution

Embracing technology, insurance companies can obtain high-efficiency levels, receive enormous encouragement to expand their operations. The customer acquisition process will be robust and effective, leading to an increased number of clients. The increase in clients – policyholders, is why all insurance firms must focus on digitizing their original manual procedures, bringing in the need for technology partners.

Read Also: Insurance Software: Choosing the Best for your Business

Traditional insurers can gain the most benefit from their technology partner by making expectations upfront, set clear goals before execution, point a dedicated source for relationship management, do a background check for credentials, identify metrics for success. We have written about how to choose a technology partner as an insurance company here.

In conclusion, AI technology has led to the growth of most insurance industries globally, with African countries adopting it at a high rate. 

Effective measures should be incorporated to reduce fraudulent activities, especially to low-income earners, by improving the economic welfare of every citizen. 

To increase customer satisfaction, insurance companies should create platforms where insurers are equipped with knowledge and skills to use online applications and electronic gadgets such as smartphones and computers to access services virtually. 

This initiative will increase trust between consumers and the insurance industry.

Curacel AI-powered technology has helped insurance companies reduced fraud, waste and abuse in their operations by 70% in time and cost of operations. Talk to Curacel to know how we can help your company thrive.

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